Can Tenant Withhold Rent to Pay for Upgrades?

by | Feb 15, 2016 | Rental Property Management Tips

A tenant writes:

Tenants are deliberately causing noise in the apartment above us. The landlord’s notices have no lasting affect. Can we withhold part of the rent to buy materials to reduce noise?

This question highlights why it is so crucial for landlords and tenants to understand their respective rights and responsibilities. This is particularly important for landlords because, whether tenants are at fault or the landlord is to blame, a problem tenancy is always going to negatively impact the landlord.

tenant screeningFor instance, a landlord must provide a tenant quiet enjoyment of the rental home. That requires actively managing the rental property.

While the specifics leading to this particular noise complaint are unknown, it is obvious that the complaining tenant is frustrated and unsatisfied with the landlord’s response. Regardless of the cause, this situation likely will lead to income loss for the landlord.

On the other hand, a tenant has the responsibility to pay rent. The right to withhold rent typically is available only if the unit is uninhabitable. However, there are cases where the tenant may be entitled to a rent abatement, early termination of the lease, or may have a claim for breach of quiet enjoyment against the landlord because of unresolved complaints. Educating tenants on their obligations, while at the same time meeting your obligations can prevent situations where tenants want to take matters into their own hands.

Income loss from such disputes can be avoided, especially if resolved early. Consider these strategies:

1. Noise issues are very common in multifamily properties. Develop rules so tenants know what they can and can’t do, and you will keep these complaints to a minimum. Include a policy for dealing with noisy tenants. Tenant should be able to access these rules easily and understand the process if there is a complaint.

2. The worst strategy for handling disputes is to do nothing. That leaves tenants to resolve problems themselves, and that’s risky business. Escalation can lead to bad consequences, like police complaints and further disruption that affects the entire property. The second-worst strategy is to do too little and think the problem is resolved. Always follow through to make sure that the offending tenant has stopped, and that the complaining tenant is reasonably satisfied.

3. Along with providing quiet enjoyment, landlords also have a duty to keep the rental home in good repair. It is possible to cover both bases at the same time. When upgrading or making repairs, focus on tenant comfort and consider materials that add safety, privacy or enjoyment. Examples include better insulation, soft-close cupboards, and insulated windows and doors.

4. Landlords should remember that, while a tenant is bound to the lease agreement, should a tenant leave early, the landlord will not be able to collect the remaining lease balance from the exiting tenant. That’s because landlords must mitigate their losses and make every effort to locate a new tenant as soon as possible. That rule gives tenants some clout when it comes to disputes. And, that’s why it’s more cost-effective to resolve a dispute with the existing tenants.

5. When dealing with tenant disputes, be mindful of the feelings of the complaining tenant. Don’t leave the person hanging. Let them know the outcome and what will happen next. Every tenant needs to know that their concerns matter. This is true even if the complaint is unwarranted. If that is the case, discuss it with the tenant in a respectful fashion.

6. Disgruntled tenants cause harm by sharing their distress with other tenants, and with local authorities. A property soon may develop a bad reputation if complaints are left unresolved. Sometimes resolution of a complaint requires creativity; sometimes it requires allowing the unhappy tenant to terminate early and move on. But be careful. You don’t want the complaining tenant to feel intimidated or that they are being forced out. Allow the tenant to be part of the solution.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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